IBM relocating key India leader back to US

Granger is the leader of cloud application innovation at IBM Global Services. The news about Granger heading back to the US, some analysts say, is a reflection of a major overhaul.Shilpa Phadnis&Avik Das | TNN | Updated: May 17, 2017, 13:27 IST

The push towards newer areas is palpable as IBM morphs into a platform company with the focus on cloud and cognitive.John Granger, a part of IBM chairman Ginni Rometty's performance team of senior executive leaders, is relocating to the US after being in India for a year and half.

Granger is one of the global leaders based here that reinforced IBM's commitment to get the India team aligned to its newer business priorities.

Granger is the leader of cloud application innovation at IBM Global Services. The news about Granger heading back to the US, some analysts say, is a reflection of a major overhaul under Mark Foster, senior vice-president in IBM Global Business Services (GBS), who is aligning its capabilities to newer growth engines. IBM is looking at the GBS business with a fresh lens under Foster.

It's now positioning GBS around three new areas -- what it calls as Interactive Experience (iX), an internal digital agency that offers design solutions to its customers. Second, IBM is leveraging cognitive technology to address some of clients' challenges as newer digital imperatives are reshaping their businesses.

And finally, GBS is also focused on deploying cloud-centric application architectures and modernising applications aligned to clients' businesses.

GBS contributed $16.7 billion or 21% to IBM's total revenue of $79.9 billion in 2016. Digital practices made up more than half of GBS revenue in 2016, said the company's regulatory filing. In India, GBS has close to 50,000 people.

Phil Fersht, CEO of US advisory firm HfS Research said, "IBM GBS is going through a major overhaul under Mark Foster, who is positioning the whole practice around cognitive process services. New executives, such as Mani Dasgupta (chief marketing officer for GBS), have been recruited and they will be phasing out some execs missing their numbers. They are only now in the restructuring phase so too early to see how this all shakes out, but change is happening there."

When TOI reached out to IBM on Granger moving back to the US, the company said, "We do not discuss specific executive movements."

The push towards newer areas is palpable as IBM morphs into a platform company with the focus on cloud and cognitive. IBM globally has now seen 20 successive quarters of declining revenue growth, but its newer revenue streams like cloud and cognitive are growing well, and India is one of its bright spots.

IBM India's revenue rose 10.3% to $3.43 billion in 2015-16, from $3.11 billion in the previous year, riding on the robust performance of its domestic IT and export IT services businesses.

Rod Bourgeois, head of research at DeepDive Equity Research, "I see evidence that IBM is struggling on multiple fronts. In GBS in particular, I think it has not made sufficient investment to pivot into digital services. Interestingly, compared to GBS, I think IBM's global technology services (GTS) unit is doing a better job of capturing digital and cloud demand," he said.

Interestingly, global technology services is learnt to be on a hiring spree in India as clients are increasingly looking at cloud deployments.The GTS team has outlined a plan to nearly double its headcount to around 60,000 people in India over the next 2-3 years.

IBM is learnt to have let go off over 200 employees in senior roles (bands 8, 9 and 10) in the GBS business last year. But sources told TOI that as the business is undergoing changes, there could be more employee separations underway. In response to the layoffs, the company said reskilling and rebalancing is an ongoing process as it accelerates the benefits of cognitive and cloud technologies for clients around the world.